NEW YORK, Feb. 25, 2009 (GLOBE NEWSWIRE) -- With clean technology ("cleantech") being a key component of President Obama's national recovery agenda, the "new energy economy" will inject new life into opportunities for cleantech investors, producers and adopters, according to a new report from PricewaterhouseCoopers LLP (PwC), entitled Cleantech Nation: Point of View. The report includes findings from the MoneyTree Report, a quarterly survey produced by PricewaterhouseCoopers and the National Venture Capital Association, based on data from Thomson Reuters.
According to PwC, rapid delivery of the stimulus plan -- ideally in the first half of 2009 -- is needed to fill the financing gap in some cash-starved, capital-intensive, renewable energy and smart grid projects, and boost venture capital investments. Venture capital (VC) investment in cleantech reached $4 billion in 2008, a 54 percent increase from 2007, with solar remaining the bright spot.
"At a time when overall economic concerns are tempering growth in clean technology, we are hopeful that the measures and direction outlined in the stimulus plan will inject a dose of adrenalin in the sector," said Tim Carey, PricewaterhouseCoopers U.S. clean technology Leader. "Clean technology investors and adopters have been given some latitude to explore new strategic alliances and opportunities as they prepare their organizations for the long term."
The decline of tax equity structured financing in 2008 is contributing to stalled commercial expansion and pilot-to-commercial development of cleantech projects. Swift project financing from the stimulus plan may help avert potential bankruptcies and crippling retrenchments through 2009.
Adopters of clean technology are expected to benefit by cutting energy costs and reducing future carbon costs, as well as gaining competitive and reputational advantages. Investors who forge strategic alliances and partnerships with innovative clean energy companies will stand to benefit the most.
The report finds that sectors granted long-term tax credit extensions attracted the most venture-backed investment. Tax credit extension uncertainties hampered growth among cleantech companies with long-term, heavily-leveraged projects. Venture capital investment in wind energy, which was given only a 2-year extension, fell nearly 40 percent. By comparison, VC investment in solar nearly doubled, and investment in fuel cell batteries rose by about 22 percent. Both solar and fuel cells were granted 8-year tax credit extensions.
The report states that investor and adopter involvement will likely increase if standards and mandates become more harmonized on a federal level, rather than on a state level, helping to provide frameworks for long-term investment plans. According to the report, congress is expected to introduce a second phase of energy legislation as early as spring which is expected to renew deliberation on a national Renewable Portfolio Standard and possibly a national cap-and-trade system leading up to the December Copenhagen climate change talks.
For more information and to download an electronic copy of Cleantech Nation: Point of View, visit www.pwc.com/CleantechNationPOV
About PricewaterhouseCoopers
PricewaterhouseCoopers (www.pwc.com) provides industry-focused assurance, tax and advisory services to build public trust and enhance value for its clients and their stakeholders. More than 155,000 people in 153 countries across our network share their thinking, experience and solutions to develop fresh perspectives and practical advice.
"PricewaterhouseCoopers" refers to the network of member firms of PricewaterhouseCoopers International Limited, each of which is a separate and independent legal entity.